CLARK FREEPORT – The state-owned Clark Development Corp. (CDC) has lost some P231.4 million of its funds deposited in two government banks, over a controversy on a bridge that has remained idle since it was constructed at the cost of P700-million during the Ramos administration in 1998.
The Development Bank of the Philippines (DBP) forfeited last Sept. 7 some P60.7 million of garnished deposits of the Clark Development Corp. (CDC) in favor of the Philippine National Construction Corp. (PNCC) and private contractor Ciriaco Corp. (Ciriaco) over the construction of a bridge here way back in 1997 whose initial balance was only at P15-million.
The Land Bank of the Philippines (LBP), where the CDC also has deposits worth some P170.7 million, informed the CDC in a letter dated last Sept. 3, said it had “no other recourse but to release the garnished funds of CDC in the absence of a restraining order from the court.”
CDC president and chief executive officer Benigno Ricafort confirmed yesterday that the P170.7-million deposit with the LBP had also been released recently to PNCC and Ciriaco.
This makes moot and academic the still pending petition filed last Sept. 8 by the CDC before the Supreme Court for a temporary restraining order (TRO) against the garnishment of its accounts totaling P231.4 million in both banks.
Apparently, the CDC was not aware the DBP had already released the P60.7 million of its garnished deposits the day before.
The total garnished amount is supposed to represent the payment demanded from the CDC by PNCC and Ciriaco for the construction of the 910-linear meter Sacobia bridge which was supposed to be a component of the Expo Pilipino theme park project for the commemoration of the Philippine Independence centennial under the administration of former Pres. Ramos in 1998.
The bridge, a project of the CDC as implementing arm of the Bases Conversion Development Authority (BCDA) rarely used and has been dubbed as a white elephant, although it connects the 4,500-hectare main freeport to the largely untapped Sacobia zone under the Philippine Export Zone Authority (PEZA).
When the bridge completed supposedly at the cost of P700-million in 1997, the CDC still had a balance of only P15-million as payment to the PNCC and its contractor Ciriaco for the project. But PNCC and Ciriaco later demanded some P200-million more to cover foreign exchange costs during the construction period, as well as interest on unpaid balance.
In informing the CDC of the pending release of its garnished P170.7 million account, LBP president and chief executive officer Gilda Pico cited a warning from the lawyers of Ciriaco that she and other bank officials, as well as Ricafort, would be charged with violation of the Anti-Graft and Corrupt Practices Act if the garnished funds are not released immediately.
In his letter to Pico last Sept. 3, Ciriaco legal counsel Wilfredo Garrido Jr. also warned her of indirect contempt “for disobedience or resistance to a lawful writ”, referring to the OGCC’s garnishment order.
Documents on the case showed that most of the OGCC’s actions on the garnishment case, which was initially petitioned by PNCC and Ciariaco in 2006, were done during the last months of the Arroyo administration.
In a latter to Malacanang last Aug. 18, the CDC made “a very urgent request” to Pres. Aquino to “freeze and review” the OGCC’s order. With no response from Malacanang, the CDC then filed a TRO petition before the Supreme Court last Sept. 8.
The CDC had argued that the OGCC had no jurisdiction over the case since it involved a private company, and not just the government-owned PNCC. It also noted that the additional cost purportedly based on exchange rate fluctuations during the bridge construction was computed contrary to provisions of Presidential Decree No. 1594 which prescribes policies, guidelines, rules and regulations for government infrastructure contracts.
The PNCC allegedly erroneously simplified the computation of cost adjustment of construction materials by simply adding the 30 percent maximum imposed by the decree, instead of following a more complicated computation per type of materials affected by fluctuations in the peso-dollar exchange rate.
The Development Bank of the Philippines (DBP) forfeited last Sept. 7 some P60.7 million of garnished deposits of the Clark Development Corp. (CDC) in favor of the Philippine National Construction Corp. (PNCC) and private contractor Ciriaco Corp. (Ciriaco) over the construction of a bridge here way back in 1997 whose initial balance was only at P15-million.
The Land Bank of the Philippines (LBP), where the CDC also has deposits worth some P170.7 million, informed the CDC in a letter dated last Sept. 3, said it had “no other recourse but to release the garnished funds of CDC in the absence of a restraining order from the court.”
CDC president and chief executive officer Benigno Ricafort confirmed yesterday that the P170.7-million deposit with the LBP had also been released recently to PNCC and Ciriaco.
This makes moot and academic the still pending petition filed last Sept. 8 by the CDC before the Supreme Court for a temporary restraining order (TRO) against the garnishment of its accounts totaling P231.4 million in both banks.
Apparently, the CDC was not aware the DBP had already released the P60.7 million of its garnished deposits the day before.
The total garnished amount is supposed to represent the payment demanded from the CDC by PNCC and Ciriaco for the construction of the 910-linear meter Sacobia bridge which was supposed to be a component of the Expo Pilipino theme park project for the commemoration of the Philippine Independence centennial under the administration of former Pres. Ramos in 1998.
The bridge, a project of the CDC as implementing arm of the Bases Conversion Development Authority (BCDA) rarely used and has been dubbed as a white elephant, although it connects the 4,500-hectare main freeport to the largely untapped Sacobia zone under the Philippine Export Zone Authority (PEZA).
When the bridge completed supposedly at the cost of P700-million in 1997, the CDC still had a balance of only P15-million as payment to the PNCC and its contractor Ciriaco for the project. But PNCC and Ciriaco later demanded some P200-million more to cover foreign exchange costs during the construction period, as well as interest on unpaid balance.
In informing the CDC of the pending release of its garnished P170.7 million account, LBP president and chief executive officer Gilda Pico cited a warning from the lawyers of Ciriaco that she and other bank officials, as well as Ricafort, would be charged with violation of the Anti-Graft and Corrupt Practices Act if the garnished funds are not released immediately.
In his letter to Pico last Sept. 3, Ciriaco legal counsel Wilfredo Garrido Jr. also warned her of indirect contempt “for disobedience or resistance to a lawful writ”, referring to the OGCC’s garnishment order.
Documents on the case showed that most of the OGCC’s actions on the garnishment case, which was initially petitioned by PNCC and Ciariaco in 2006, were done during the last months of the Arroyo administration.
In a latter to Malacanang last Aug. 18, the CDC made “a very urgent request” to Pres. Aquino to “freeze and review” the OGCC’s order. With no response from Malacanang, the CDC then filed a TRO petition before the Supreme Court last Sept. 8.
The CDC had argued that the OGCC had no jurisdiction over the case since it involved a private company, and not just the government-owned PNCC. It also noted that the additional cost purportedly based on exchange rate fluctuations during the bridge construction was computed contrary to provisions of Presidential Decree No. 1594 which prescribes policies, guidelines, rules and regulations for government infrastructure contracts.
The PNCC allegedly erroneously simplified the computation of cost adjustment of construction materials by simply adding the 30 percent maximum imposed by the decree, instead of following a more complicated computation per type of materials affected by fluctuations in the peso-dollar exchange rate.
